For a rising pop star, the money side of the music business has drastically changed in the last few years, according to Andrew Gertler, who manages teen singer-songwriter sensation Shawn Mendes and runs AG Artists.
“The music really is not as much the revenue generator as the marketing tool to then create other income streams,” Gertler told Business Insider, speaking by phone from Mendes’ worldwide arena tour.
Those other income streams include not only things like live events and brand deals, but also opportunities at the crossroads of music and TV (or video in general), where Gertler said the line is getting more and more blurred.
The growth stage
Though Mendes has already cracked the top 10 on Billboard’s Hot 100 multiple times, Gertler looks at his career as a growth-stage business.
“For the artists’ fans and for artists, in terms of exposure, music should be everywhere and as easily accessible as humanly possible … especially for an artist you are still building,” Gertler said. Mendes is on an upward trajectory, and hasn’t yet reached mega-stardom, Gertler explained. The idea is this: “Let’s get him in front of as many people as possible.”
That style of thinking sounds strikingly similar to tech startups, where the initial focus is often on grabbing as many users as possible, before turning toward better monetisation later on.
And as far as making money from the actual music, Gertler has also seen a shift. He used to see about 75% of that revenue from sales on iTunes, with 25% coming from streaming services like Spotify. Now it’s more like 65-70% streaming, and 30% iTunes. “It’s been a complete flip in only a few years,” Gertler said.
Besides revenue, the other biggest change for up-and-coming music stars is the amount of access fans want to their private lives.
“Fans and the general public are so used to unlimited access,” Gertler said. So is there any line? “There really isn’t one,” according to Gertler. Fans “probably know [pop stars] better than anyone should know someone.”
This also means that it is extremely difficult for a pop star to have continued success without a sense of authenticity. It’s not like the past, where there were flashing lights and spectacle, and you didn’t really know what the artist was like in day-to-day life. Now you see what an artist is doing when they wake up, Gertler said.
Artists that succeed in this model are those who can make a one-to-many relationship feel like a one-to-one relationship. “How do you make it feel like they really know you,” Gertler said.
That necessity for a sense of authenticity can also make brand deals tricky. It used to be you could do an exclusive clothing deal, and no one saw you every single day, Gertler explained. Now people see stars at all times on social media, and you have to be a bit more careful. It’s more of a commitment.
For a manager, this new world requires much more “hand-to-hand combat,” according to Gertler. He’s travelling all over the place with Mendes, and a lot of young managers doing the same, he said, citing Pat Corcoran who manages Chance the Rapper.
You have to be at the center of the universe of that artist to understand what is going on at all times — and what the fans want. It is an ongoing dialogue with fans that happens in real-time. If you aren’t at the center of it, you could get out of step.